How many people actually know what this is?
Why are they in charge of US currency?

I think a lot of people know exactly what it is. It's a private bank empowered by the Federal Reserve Act to act as the central bank for the United States.

---------- Post added 2013-02-11 at 03:07 PM ----------

Originally Posted by lockedout

They are not even part of the federal government. They are a private entity.

So what? That has nothing to do with what he said.

'Twas a cutlass swipe or an ounce of lead
Or a yawing hole in a battered head
And the scuppers clogged with rotting red
And there they lay I damn me eyes
All lookouts clapped on Paradise
All souls bound just contrarywise, yo ho ho and a bottle of rum!

I think a lot of people know exactly what it is. It's a private bank empowered by the Federal Reserve Act to act as the central bank for the United States.

---------- Post added 2013-02-11 at 03:07 PM ----------

So what? That has nothing to do with what he said.

He said they aren't in charge of US currency. All my money says federal reserve note on it.

If you will pull a dollar bill out and take a look at it, you will notice that it says "Federal Reserve Note" at the top.

It belongs to the Federal Reserve.

The U.S. government cannot simply go out and create new money whenever it wants under our current system.

Instead it must get it from the Federal Reserve.

So when the U.S. government needs to borrow more money (which happens a lot these days) it goes over to the Federal Reserve and asks them for some more green pieces of paper called Federal Reserve Notes.

The Federal Reserve swaps these green pieces of paper for pink pieces of paper called U.S. Treasury bonds. The Federal Reserve either sells these U.S. Treasury bonds or they keep the bonds for themselves (which happens a lot these days).

So that is how the U.S. government gets more green pieces of paper called "U.S. dollars" to put into circulation. But by doing so, they get themselves into even more debt which they will owe even more interest on.

So every time the U.S. government does this, the national debt gets even bigger and the interest on that debt gets even bigger.

He said they aren't in charge of US currency. All my money says federal reserve note on it.

If you will pull a dollar bill out and take a look at it, you will notice that it says "Federal Reserve Note" at the top.

It belongs to the Federal Reserve.

The U.S. government cannot simply go out and create new money whenever it wants under our current system.

Instead it must get it from the Federal Reserve.

So when the U.S. government needs to borrow more money (which happens a lot these days) it goes over to the Federal Reserve and asks them for some more green pieces of paper called Federal Reserve Notes.

The Federal Reserve swaps these green pieces of paper for pink pieces of paper called U.S. Treasury bonds. The Federal Reserve either sells these U.S. Treasury bonds or they keep the bonds for themselves (which happens a lot these days).

So that is how the U.S. government gets more green pieces of paper called "U.S. dollars" to put into circulation. But by doing so, they get themselves into even more debt which they will owe even more interest on.

So every time the U.S. government does this, the national debt gets even bigger and the interest on that debt gets even bigger.

Treasury bills aren't the only thing the Fed buys to manage money supply. And the actual bills are printed by the US treasury, not the Fed. The Fed buys the bills from the Treasury Department.

Either way, you still haven't made a point.

'Twas a cutlass swipe or an ounce of lead
Or a yawing hole in a battered head
And the scuppers clogged with rotting red
And there they lay I damn me eyes
All lookouts clapped on Paradise
All souls bound just contrarywise, yo ho ho and a bottle of rum!

Treasury bills aren't the only thing the Fed buys to manage money supply. And the actual bills are printed by the US treasury, not the Fed. The Fed buys the bills from the Treasury Department.

Either way, you still haven't made a point.

Point is privately owned banks control our countries money supply. It doesn't say US Treasury Note.
I was just curious to see peoples views on that. Most people think since it says "Federal" it is part of the government.

Point is privately owned banks control our countries money supply. It doesn't say US Treasury Note.
I was just curious to see peoples views on that. Most people think since it says "Federal" it is part of the government.

I think some people think that, but a lot of us, especially those of us on a site like this that talks about it regularly, or those who have gone to University, know exactly what it is.

My view on it is that it's fine. I think that the Fed has generally acted sensibly and responsibly throughout its history, to the benefit of the US economy.

'Twas a cutlass swipe or an ounce of lead
Or a yawing hole in a battered head
And the scuppers clogged with rotting red
And there they lay I damn me eyes
All lookouts clapped on Paradise
All souls bound just contrarywise, yo ho ho and a bottle of rum!

Bernanke is particularly interested in the economic and political causes of the Great Depression, on which he has published numerous academic journal articles. Before Bernanke's work, the dominant monetarist theory of the Great Depression was Milton Friedman's view that it had been largely caused by the Federal Reserve's having reduced the money supply. In a speech on Milton Friedman's ninetieth birthday (November 8, 2002), Bernanke said, "Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna [Schwartz, Friedman's coauthor]: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again."

you mean like their admission that they were responsible for the great depression? really responsible...

I'm not sure what you're specifically referring to, but I'd much rather our institutions recognize when they made a mistake and work to avoid such mistakes in the future. That is responsible behavior.

'Twas a cutlass swipe or an ounce of lead
Or a yawing hole in a battered head
And the scuppers clogged with rotting red
And there they lay I damn me eyes
All lookouts clapped on Paradise
All souls bound just contrarywise, yo ho ho and a bottle of rum!

Point is privately owned banks control our countries money supply. It doesn't say US Treasury Note.
I was just curious to see peoples views on that. Most people think since it says "Federal" it is part of the government.

Postal Service isn't part of the government either, but that doesn't mean the government doesn't exert as much or as little control as they desire upon it.